Long Term Interest Rates May Double

A FEDERAL RESERVE  STUDY PREDICTS long term interest rates may double causing a double dip recession reports the Telegraph.

This is consistent with my prior posts.  Whether this story is true or not, I don’t know.

Should this occur, and long term Treasury interest rates double,  real estate would be plunged into a depression far worse than the 1930s.

Connecting the dots, there seems to be a direct connection between the Stimulus funds not being disbursed and the Treasury’s  reluctance to auction the Treasury bills and notes necessary to finance the Stimulus.  The mainstream media seems to forget,  Treasury does not have the cash to disburse the Stimulus money.  Tax revenues have long since been spent.   The government must first sell Treasury notes and bonds to borrow the money to pay the  Stimulus money authorized by Congress.

Selling an additional $787 billion in Treasuries may well cause  interest rates to double, for example the 10 year T note interest increasing from 3.5% today to 7%.  Fixed rate 30 year mortgage interest rates would increase to 10%.